Analysis of Long-term (Investment) Activity Ratios
Activity ratios measure how efficiently a company performs day-to-day tasks, such us the collection of receivables and management of inventory.
Long-term Activity Ratios (Summary)
Altria Group Inc., long-term (investment) activity ratios
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Net fixed asset turnover | 14.82 | 15.61 | 16.75 | 13.00 | 12.56 | |
| Total asset turnover | 0.63 | 0.68 | 0.66 | 0.55 | 0.51 | |
| Equity turnover | — | — | — | 9.21 | 4.04 |
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).
The investment activity ratios indicate a period of increased asset efficiency that peaked between 2021 and 2022, followed by a moderate contraction in 2023. Overall, the company demonstrates a higher capacity to generate revenue from its assets compared to the 2019 baseline.
- Net Fixed Asset Turnover
- An upward trajectory was observed from 2019 to 2021, where the ratio rose from 12.56 to a peak of 16.75. A subsequent decline occurred over the next two years, with the ratio settling at 14.82 by December 31, 2023. Despite this recent downward trend, the efficiency of fixed asset utilization remains significantly higher than the initial 2019 levels.
- Total Asset Turnover
- Total asset utilization showed a steady improvement from 0.51 in 2019 to a peak of 0.68 in 2022. A slight decrease to 0.63 was recorded in 2023. The data suggests a general enhancement in the company's ability to generate sales from its total asset base throughout the majority of the analyzed period.
- Equity Turnover
- A substantial increase was recorded between 2019 and 2020, with the ratio rising from 4.04 to 9.21. This indicates a significant spike in revenue generation relative to shareholder equity during that specific interval; however, the absence of data for the subsequent three years precludes the identification of a long-term trend.
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Net Fixed Asset Turnover
Altria Group Inc., net fixed asset turnover calculation, comparison to benchmarks
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net revenues | 24,483) | 25,096) | 26,013) | 26,153) | 25,110) | |
| Property, plant and equipment, net | 1,652) | 1,608) | 1,553) | 2,012) | 1,999) | |
| Long-term Activity Ratio | ||||||
| Net fixed asset turnover1 | 14.82 | 15.61 | 16.75 | 13.00 | 12.56 | |
| Benchmarks | ||||||
| Net Fixed Asset Turnover, Competitors2 | ||||||
| Coca-Cola Co. | 4.95 | 4.37 | 3.90 | — | — | |
| Mondelēz International Inc. | 3.72 | 3.49 | 3.32 | — | — | |
| PepsiCo Inc. | 3.38 | 3.56 | 3.55 | — | — | |
| Philip Morris International Inc. | 4.68 | 4.73 | 5.09 | — | — | |
| Net Fixed Asset Turnover, Sector | ||||||
| Food, Beverage & Tobacco | 3.90 | 3.86 | 3.78 | — | — | |
| Net Fixed Asset Turnover, Industry | ||||||
| Consumer Staples | 5.17 | 5.21 | 5.06 | — | — | |
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).
1 2023 Calculation
Net fixed asset turnover = Net revenues ÷ Property, plant and equipment, net
= 24,483 ÷ 1,652 = 14.82
2 Click competitor name to see calculations.
The analysis of long-term investment activity between 2019 and 2023 reveals a period of fluctuating asset efficiency, characterized by a significant peak in turnover in 2021 followed by a gradual decline.
- Net Fixed Asset Turnover Trend
- The net fixed asset turnover ratio increased from 12.56 in 2019 to a peak of 16.75 in 2021. Following this peak, the ratio experienced a consistent downward trajectory, falling to 15.61 in 2022 and further to 14.82 by the end of 2023. This indicates that while the company improved its ability to generate revenue per dollar of net fixed assets during the first half of the period, this efficiency gain has partially reversed in recent years.
- Revenue Dynamics
- Net revenues exhibited relative stability with a slight peak in 2020 at 26,153 million US dollars. However, a steady decline is observed from 2021 through 2023, with revenues dropping to 24,483 million US dollars. This contraction in the top line contributed to the downward pressure on the turnover ratio in the latter part of the analyzed period.
- Net Property, Plant, and Equipment Influence
- A significant reduction in the net property, plant, and equipment base occurred in 2021, dropping to 1,553 million US dollars from 2,012 million US dollars in 2020. This sharp decrease in the denominator was the primary driver behind the spike in the 2021 turnover ratio. Since 2021, there has been a gradual increase in net fixed assets, reaching 1,652 million US dollars in 2023. The combination of rising asset values and declining revenues explains the erosion of the turnover ratio between 2021 and 2023.
In summary, the efficiency of fixed asset utilization peaked in 2021 due to a reduction in the asset base. The subsequent decline in the turnover ratio reflects a trend of decreasing revenue generation occurring alongside a modest recovery in net fixed asset investments.
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Total Asset Turnover
Altria Group Inc., total asset turnover calculation, comparison to benchmarks
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net revenues | 24,483) | 25,096) | 26,013) | 26,153) | 25,110) | |
| Total assets | 38,570) | 36,954) | 39,523) | 47,414) | 49,271) | |
| Long-term Activity Ratio | ||||||
| Total asset turnover1 | 0.63 | 0.68 | 0.66 | 0.55 | 0.51 | |
| Benchmarks | ||||||
| Total Asset Turnover, Competitors2 | ||||||
| Coca-Cola Co. | 0.47 | 0.46 | 0.41 | — | — | |
| Mondelēz International Inc. | 0.50 | 0.44 | 0.43 | — | — | |
| PepsiCo Inc. | 0.91 | 0.94 | 0.86 | — | — | |
| Philip Morris International Inc. | 0.54 | 0.51 | 0.76 | — | — | |
| Total Asset Turnover, Sector | ||||||
| Food, Beverage & Tobacco | 0.62 | 0.61 | 0.60 | — | — | |
| Total Asset Turnover, Industry | ||||||
| Consumer Staples | 1.51 | 1.47 | 1.41 | — | — | |
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).
1 2023 Calculation
Total asset turnover = Net revenues ÷ Total assets
= 24,483 ÷ 38,570 = 0.63
2 Click competitor name to see calculations.
The analysis of financial activity between 2019 and 2023 reveals a period of increasing asset efficiency followed by a slight moderation in the final year. The overall trajectory shows that the organization has managed to generate more revenue per unit of asset held, primarily through a reduction in the total asset base rather than through revenue expansion.
- Net Revenue Trends
- Net revenues remained relatively stable throughout the period, peaking at 26,153 million US$ in 2020. Following this peak, a gradual downward trend is observed, with revenues declining to 24,483 million US$ by December 31, 2023. This indicates a slight contraction in the top-line performance over the five-year window.
- Total Asset Base Dynamics
- A significant reduction in total assets occurred between 2019 and 2022, with the asset base falling from 49,271 million US$ to 36,954 million US$. This represents a substantial contraction of the balance sheet. This trend reversed slightly in 2023, as total assets increased to 38,570 million US$.
- Total Asset Turnover Analysis
- The total asset turnover ratio exhibited a consistent upward trend from 0.51 in 2019 to a peak of 0.68 in 2022. This improvement in efficiency is attributed to the fact that the decrease in total assets outpaced the fluctuations in net revenues. However, in 2023, the ratio declined to 0.63, a result of the simultaneous decrease in revenues and the increase in total assets, which diminished the efficiency of asset utilization relative to the previous year.
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Equity Turnover
Altria Group Inc., equity turnover calculation, comparison to benchmarks
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net revenues | 24,483) | 25,096) | 26,013) | 26,153) | 25,110) | |
| Stockholders’ equity (deficit) attributable to Altria | (3,540) | (3,973) | (1,606) | 2,839) | 6,222) | |
| Long-term Activity Ratio | ||||||
| Equity turnover1 | — | — | — | 9.21 | 4.04 | |
| Benchmarks | ||||||
| Equity Turnover, Competitors2 | ||||||
| Coca-Cola Co. | 1.76 | 1.78 | 1.68 | — | — | |
| Mondelēz International Inc. | 1.27 | 1.17 | 1.02 | — | — | |
| PepsiCo Inc. | 4.94 | 5.04 | 4.95 | — | — | |
| Philip Morris International Inc. | — | — | — | — | — | |
| Equity Turnover, Sector | ||||||
| Food, Beverage & Tobacco | 3.39 | 3.26 | 3.12 | — | — | |
| Equity Turnover, Industry | ||||||
| Consumer Staples | 5.62 | 5.26 | 5.06 | — | — | |
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).
1 2023 Calculation
Equity turnover = Net revenues ÷ Stockholders’ equity (deficit) attributable to Altria
= 24,483 ÷ -3,540 = —
2 Click competitor name to see calculations.
The financial performance of Altria Group Inc. between 2019 and 2023 is characterized by relatively stable net revenues contrasted against a significant deterioration in stockholders' equity, which transitioned into a persistent deficit.
- Net Revenue Trends
- Net revenues remained comparatively stable over the five-year period, experiencing a slight peak in 2020 at US$ 26,153 million. Following this peak, a gradual downward trend is observed, with revenues declining to US$ 24,483 million by December 31, 2023. This represents a total decrease of approximately 2.5% from the 2019 baseline.
- Stockholders' Equity Position
- A critical contraction in stockholders' equity occurred throughout the analyzed timeframe. Equity fell from US$ 6,222 million in 2019 to US$ 2,839 million in 2020, and shifted into a negative balance in 2021. The equity deficit deepened to US$ 3,973 million in 2022 before showing a slight reduction to US$ 3,540 million in 2023.
- Equity Turnover Interpretation
- The equity turnover ratio showed a sharp increase from 4.04 in 2019 to 9.21 in 2020. This spike was driven by the rapid decline in the equity base rather than an expansion in sales. For the years 2021 through 2023, the ratio is not available, as the presence of negative stockholders' equity renders the standard equity turnover calculation mathematically and analytically invalid.
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